The Recession is Here: Is It Time to Buy a Business Instead of Finding a New Job?

The pain of being laid off can be overwhelming. The uncertainty, the financial burden, and the emotional stress can make it difficult to move on. But what if I told you there was a way to take control of your future? What if you could become your own boss, run a profitable business, and secure your financial stability? With an SBA loan, you can do just that.

Being laid off is a common experience during a recession, and it can be devastating for talented people who have invested years of their lives in their careers. Working for a company that can lay you off at any moment can be stressful, and the uncertainty of finding a new job can add to the pressure.

After losing a job, many people may consider starting their own business. Starting your own business from scratch can be risky, time-consuming, and expensive. What if instead of starting a business, you could just buy one? Buying an existing and profitable business can provide you with an opportunity to hit the ground running, leveraging the success of an established enterprise. This is where an SBA loan can come in handy.

Unlocking the Benefits of SBA Business Acquisition Loans

An SBA loan is a government-backed loan designed to help small businesses. One of the most popular types of SBA loans is the business acquisition loan, which allows someone to purchase an established business with as little as 10% down. To qualify for an SBA loan, the buyer must have relevant and transferrable experience related to the business being purchased. If the buyer does not have such experience, they can bring on a partner who does.

Maximizing Your Chances of Approval for an SBA Business Acquisition Loan

To maximize your chances of approval, the lender will consider compensating factors for the buyer such as strong personal credit, substantial post-closing liquidity, outside personal income, and real estate with at least 25% equity as collateral to pledge. The business that is being sold must make enough profits (EBIDTA) to be able to repay the loan that the buyer is taking out.

Pro tip #1: SBA lenders like if the seller agrees to hold a note of at least 10%, as the seller then has "skin in the game" and will be motivated for the new buyer to succeed.

Pro tip #2: You can buy a business that includes commercial real estate (CRE).?As long as your business occupies at least 51% of the rentable square footage, you can obtain an SBA loan. Buying a business with CRE can also push the loan term out to as long as 25-years.

Build Upon Success: Why Buying an Existing Business is Beneficial

Buying a business has several advantages.

1. It allows you to skip the risky startup phase and take over an existing and profitable enterprise.
2. It provides you with an opportunity to build and improve upon an already successful business, leveraging your skills and expertise.
3. It allows you to grow the business and later sell it, providing you with a potential exit strategy and a source of retirement income.
4. It provides you with the freedom and flexibility of being your own boss, running your own enterprise, and securing your financial future.

If you are considering buying a business using an SBA loan, it is essential to do your due diligence. Research the types of businesses that interest you, consider your experience and skills, and reach out to a qualified lender or company that understands SBA loans. Working with an experienced lender can help you navigate the application process and secure the financing you need to buy the right business. Don't let the fear of being laid off hold you back. Take control of your future today by buying a profitable business with an SBA loan.